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Friday, 31st July 2009 (731 views)

In less than 20 years, China has gone from having virtually no gold mining industry to being the world's biggest producer of the precious metal and according to one expert, the country's "new gold rush" is just beginning.

Writing on Daily Wealth, Matt Badiali said the Chinese government started exploring for mineral resources in the 1950s and 1960s but lacked the expertise to extract its discoveries.

However, in the 1970s, Beijing began modernising its economy, with mining one of the first areas to benefit from this slow process.

The government's decision to allow foreign mining specialists to work in the country has "reinvented" the industry, with gold production increasing by 134 per cent between 1997 and 2007.

Mr Badiali said most of China's mining regions have only been open to exploration by overseas firms for just over a decade, meaning the majority of the country's "enormous wealth of metal" remains underground.

"China's decades-old decision to open its mineral resources to foreign mining companies is just now coming to fruition," he commented.

According to consultancy GFMS, China ended South Africa's century-long reign as the world's top gold producer after its annual production rose by 33 tonnes in 2007.

 

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